On the Road to Recovery

“I hate to start your meeting with an Economics 101 lecture,” Laura D'Andrea Tyson said apologetically, as she addressed the opening general session in San Francisco.

“But,” continued Tyson, who is the S.K. and Angela Chan Professor of Global Management at the Haas School of Business, University of California, Berkeley, “I do agree with Warren Buffett that the global economy has fallen off a cliff. When we dig ourselves out of this, we'll not be where we were before. But, what will we recover to?”

Tyson, who also serves on President Obama's Economic Advisory Panel, made these three major points related to economic recovery, particularly in the United States:

We're currently building a bridge to the new normal. “The business climate for this year and next,” said Tyson, “will continue to be difficult. We'll need to engage in what will doubtlessly be contentious discussions about what to do about the deficit and how best to bring debt under control. Clearly, the government's ability to deliver services will be greatly reduced.” Tyson also noted that, “colleges and universities in this country are considered part of the 'discretionary budget.' We need to change that attitude and make people understand that higher education institutions are part of our infrastructure and require investment.”

Growth will depend significantly on innovation. “We're on the frontier of technology,” explained Tyson, “but we have to go beyond that. We can't improve by only managing businesses better and creating more jobs.” Tyson pointed out that while America is still perceived as the world's preeminent educator, “in 2006, we were ranked 14th in higher education. And we are not good at filling the pipeline. More than 40 percent of our college graduates in science and math are foreign students.”

Higher education must play a more active role. She noted that U.S. multi-national companies create international employment opportunities and conduct valuable research. “They can go anywhere in the world to do what they do,” she cautioned. “Educational institutions must find as many ways as possible to work with these companies to train the talent we need.” (See a preconference interview in the April 2010 Business Officer.)

By working with the corporate world, said Tyson, “higher education leaders can send a powerful message to our political leadership, letting them know that the best way to invest in our future is to invest in talent and people.”